Swiss franc impact Vietnamese overseas
Swiss franc impact Vietnamese overseas
The franc surged after the Swiss central bank abandoned its bid to artificially keep its value down, a move which has taken a profound toll on a number of Vietnamese residing overseas, especially those in Eastern Europe.
Without prior notice, the Swiss National Bank’s (SNB) floating of its currency sent the Polish zloty tumbling against the franc last week, reaching up to the heights between PLN4.26 to 4.60 per franc
According to Tran Quoc Quan, a successful businessman who also holds shares in the European Asian Commercial Center (EACC) in Poland, the franc surged 40 per cent against the zloty right after the SNB announcement and triggered a substantial increase in the zloty value of franc-based loan principals and monthly payments for about 600,000 Polish families, including many Vietnamese families residing in Poland, owing a total of $35 billion in mortgages denominated in the Swiss franc.
Back in 2008, people in Poland saw the Swiss franc and the strengthening zloty as a chance at cheap mortgages. T. Nguyen, a Vietnamese-born Polish resident living in Warsaw, borrowed hundreds of francs in 2008 to purchase a residential property in the capital city and is currently facing the mounting pressure of loan repayments after the Swiss franc surge.
“The number of Vietnamese families affected by the Swiss rise, although official figures are not yet available, could be in the thousands and the value of loan payments could be equivalent to tens of millions of USD,” added Quan.
According to unofficial data, there are currently over 50,000 Vietnamese living and working in Poland.
Meanwhile, Nguyen Kim Phuong, an overseas student undertaking her second year of Bachelor’s degree in Hospitality Management in Leysin, Switzerland felt the hefty burden of the currency rise. By Phuong’s estimations, her tuition fees and accommodation fees in 2015 will increase at least by 10 per cent after the Swiss exchange rate rose last week.
Phuong told VIR that her family will have to face the increased pressure of her annual CHF30,400 tuition and accommodation fees for the next two years and as they did not anticipate the franc to appreciate they will need more VND for the exchange in the coming time. The CHF/VND forex rate last week moved around VND24,230 per CHF.
As for the local Vietnamese, the franc increase may not affect them directly at the moment, however, for those who are thinking of purchasing a new Swiss watch or some sweet treats from Switzerland, bear in mind that import will get a whole lot more expensive.
